Estimated read time: 20 minutes, 57 seconds
To help you choose between Stripe vs. Paddle vs. FastSpring, this guide compares:
- What areas of the payment lifecycle each one provides a solution for (e.g., payment processing, gathering and remitting taxes, and subscription management) and what additional software you’ll need to add to your tech stack.
- What companies and industries each one serves.
Then, we provide a detailed comparison of key features such as checkout and reporting. Finally, we share several customer reviews and case studies for each solution.
In a nutshell, Stripe primarily deals with payment processing, whereas FastSpring and Paddle handle payment processing, subscription management, collecting and remitting tax, fraud protection, and much more without the need for additional software.
Table of Contents
Note: Information in this article is true at the time of writing but is subject to change.
FastSpring handles everything from maintaining high authorization rates to paying end-of-year consumption taxes for SaaS companies. Sign up for a free account or request a demo today to see how FastSpring can help you expand globally.
What areas of the payment lifecycle will you be able to manage and what other software will you need for a complete payment solution?
Stripe: Payment Processing
Stripe is best known for payment processing, meaning they help you collect payment details and get payments authorized. In addition, they also offer a few basic features for subscription management, fraud detection, invoicing, and more.
These additional features can satisfy the needs of some early-stage startup companies, however, most companies end up needing more robust options. Eventually, you’ll need additional software to manage complex recurring billing needs, accept more payment methods around the world, or create a customized checkout process. Luckily, most developers find it easy to integrate Stripe with most other software (however, you have to pay for each software separately).
Most companies using Stripe also need additional staff to manage sales tax (and VAT) and regulatory compliance. While Stripe gathers sales tax and VAT for you, you’ll be responsible for remitting it. If you remit these taxes in the wrong amount, at the wrong time, or in the wrong way, you could face financial loss and penalties. (More on this later.)
Plus, you’ll be responsible for staying up to date and adhering to the local laws and regulations where your customers live. This is a huge undertaking for any company which is why most companies dedicate an entire department to the task.
FastSpring: The Entire Payment Lifecycle
Unlike Stripe, with FastSpring, you’ll have access to:
- Multiple payment processors (which improves authorization rates and makes it easier to transact globally).
- Flexible subscription management and recurring billing tools.
- B2B digital invoicing.
- Advanced fraud detection.
- Fully customizable checkout.
- Detailed reports and analytics.
- And much more.
Plus, we act as your Merchant of Record (MoR), meaning we take on transaction liability for you. We collect and remit sales tax and VAT on your behalf, and take the lead on regulatory compliance and audits.
You’ll be able to manage all aspects of the payment lifecycle from your FastSpring dashboard without adding extra software or headcount.
Paddle: Most of the Payment Lifecycle
Paddle offers solutions for payment processing, subscription management, and fraud detection, and is more feature-rich than Stripe’s solutions. However, some of Paddle’s features are less robust than FastSpring’s features. For example, FastSpring’s checkout is more customizable than Paddle’s checkout options (more on this later).
If Paddle doesn’t offer the functionality you need, you may need to add additional software or switch to a different service.
Like FastSpring, Paddle is an MoR.
Related: SaaS Billing Software: 7 Tools in 3 Categories & How to Choose – FastSpring
What Types of Businesses and Which Industries Can Use Each Platform?
Stripe: Nearly Any Business
Stripe can be used by nearly any type of business in nearly any industry. However, SaaS companies will inevitably run into a few struggles while using Stripe.
As we mentioned earlier, companies using Stripe are entirely responsible for remitting sales tax and VAT. It used to be true that SaaS companies didn’t have to remit sales tax or VAT, however, many states and countries are creating (and strongly enforcing) new laws that require SaaS companies to remit sales tax or VAT.
Here are two examples:
- On January 1, 2015, the European Union began requiring software sellers to collect and remit VAT based on the location of the buyer — not the location of the seller’s company or employees.
- In 2018, the United States Supreme Court ruled that states may charge sales tax on purchases made from out-of-state sellers (including online sellers), even if the seller does not have a physical presence in the taxing state.
Keeping track of and adhering to constantly changing tax laws is a difficult challenge. That’s why SaaS companies (and companies selling any digital products) are better off choosing a solution like FastSpring that will handle remitting sales tax and VAT for you.
FastSpring: B2C and B2B SaaS or Digital Goods Companies
For nearly 20 years, FastSpring has been serving B2C and B2B companies selling SaaS, digital products, and downloadable software:
- Mailbird achieved over 100% growth by switching from Stripe to FastSpring. The flexibility of the platform and the ability to stay compliant with tax laws, were the main reasons Mailbird chose FastSpring. Read the Mailbird case study here.
- NotePlan increased conversions by over 60% by switching from Paddle to FastSpring. FastSpring offered several checkout, localization, and coupon features that NotePlan needed. Plus, our team provided personalized recommendations for ways NotePlan could improve their checkout experience to optimize conversions. Read the NotePlan case study here.
- SocialBee doubled their monthly recurring revenue and managed tax compliance by switching from Braintree to FastSpring. Once the SocialBee team realized they needed more than a payment processor, partnering with FastSpring was an easy choice. Read the SocialBee case study here.
Paddle: B2C SaaS
Paddle has been serving SaaS companies for about ten years. Paddle’s platform is better suited for B2C companies, however, they are working on adding new features for B2B companies, such as automated invoicing.
If adding B2B services is in your future, these features may be established by the time you need them. However, if you’re already selling B2B products, you may want to consider another option with fully functioning B2B features (FastSpring’s Digital Invoicing tool for B2B has been live for several years).
Next, we compare Stripe vs. FastSpring vs. Paddle, according to specific features.
Functionality and Feature Comparisons
Payment Processing (Payment Methods, Currencies, and More)
To start processing payments with Stripe, you have to configure each location with the currency and payment methods you want to offer in that location. Once set up, Stripe will automatically convert product prices and display the correct currency and payment options at checkout.
Stripe supports 135+ currencies.
You’ll be able to accept payments from major credit card networks (including MasterCard and Visa), bank transfers, vouchers, and popular wallets like Apple Pay and Google Pay. However, they don’t support PayPal.
Stripe also supports in-person transactions via the Stripe Terminal and mobile SDKs.
FastSpring makes it simple for SaaS and ecommerce companies to accept payments in most currencies and preferred payment methods around the world. Instead of configuring each one individually, FastSpring sellers can simply turn on localized payments and start accepting global payments right away.
While Stripe automatically converts prices to the local currency for you, FastSpring provides more flexibility:
- You can let FastSpring make the conversions for you, or you can set a fixed price for each of your products in each currency.
- You can let FastSpring choose the appropriate currency based on the user’s location, you can choose a specific currency for each location, or you can let the customer choose their preferred currency. FastSpring supports 23+ currencies.
With FastSpring, customers can make payments using:
- Credit cards including Visa, MasterCard, American Express, Discover, JCB, and UnionPay.
- SEPA Direct Debit.
- Wire transfers.
- Wallets including PayPal, Apple Pay, Amazon, Alipay, and more.
Finally, unlike Stripe which is a single payment processor, FastSpring connects to multiple international payment gateways, which improves the likelihood that a payment will be authorized.
Payments have a higher success rate when the payment gateway is in the same location as the buyer. FastSpring automatically routes online payments through the gateway with the highest authorization rates for that payment method and location.
Plus, using multiple payment gateways solves most failed payment issues that are due to network errors. If a payment gateway is experiencing a technical failure, FastSpring automatically retries the payment using a different gateway — without your team having to lift a finger.
Bonus: FastSpring Partners with Sift
FastSpring takes the lead on fraud and risk activities (including chargebacks). We partner with Sift, a global leader in risk analysis and fraud prevention, to keep your transaction secure. Sift uses machine learning and AI to:
- Increase accuracy in fraud decisions.
- Improve approval rates and result in fewer false positives.
- Stop bad actors before a transaction is even processed.
FastSpring also blocks transactions from countries and jurisdictions where companies are currently not allowed to do business.
Paddle also utilizes multiple payment gateways and lets companies accept global payments with minimal setup.
Paddle supports 20+ currencies, popular credit cards (including MasterCard, Union Pay, and more), wire transfers, and wallets (including Apple Pay, Google Pay, PayPal, and Alipay) — although some of these options are still in beta testing.
Calculating and Remitting Sales Tax, VAT, and GST
Stripe acquired TaxJar to help you calculate sales tax, VAT, and GST. However, they only provide instructions for enabling tax features and assigning tax codes. You are responsible for the decisions and implications of using those features (e.g., knowing how your product is classified under tax law and if/where you have nexus, need to register, collect, file, and submit consumption tax). If you have questions about how to optimize tax rates, qualify for reduced tax rates, or any other tax-related question, you’ll likely be told to consult your tax advisor or read through the help articles.
If you accidentally set it up incorrectly and collect the wrong amount (or type) of tax, you’ll be held liable.
Plus, remitting sales taxes is often more involved than filling out a simple spreadsheet and writing a check. More and more countries are mandating additional requirements to stay compliant. For example:
- Countries such as Colombia, Japan, Mexico, Serbia, and others require local representation, meaning you have to hire someone with a physical presence in that country to be responsible for your tax liability. This can cost anywhere from $5k to $15k per year.
- Countries such as India, Indonesia, Japan, and others require your account to be “pre-funded” meaning you have to predict the amount of tax you will owe and keep that money in your account until it’s time to file (up to three months in advance).
- Countries such as Serbia, United Kingdom, Taiwan, and others require electronic invoicing (it applies to non-resident companies, as well). This typically costs companies $2k-$5k per year. Note: E-invoicing mandates are increasing at an alarming rate — with the EU rolling out universal electronic invoicing requirements by 2028.
- Countries such as Taiwan, Indonesia, Nigeria, Vietnam, and others require you to fileincome taxin addition to indirect tax (this can add up to $5-$10k per year).
Finally, wiring international tax payments is not easy or free. The corresponding and receiving banks both charge fees and there’s the additional risk involved with foreign transactions.
So, while Stripe has taken an important step towards helping you collect sales tax by acquiring TaxJar, they’re a long way from providing an end-to-end solution for sales tax and international tax.
FastSpring handles the entire process of gathering and remitting sales tax, VAT, and GST for you.
With over 20 years of experience filing 1,200+ tax returns each year, our team ensures the correct amount (and type) of indirect tax is being collected at checkout — we even handle tax-exempt transactions in the U.S. and 0% reverse charges when allowed internationally.
FastSpring files and collects taxes in 52 countries, 13 provinces, and all 45 U.S. states that collect sales tax (five states don’t collect any sales tax).
Then, our team remits those taxes for you and ensures all the necessary procedures are in place to stay compliant. If a country or state approaches you about tax compliance, our team will advise you on how to respond — even as far as providing copy-and-paste responses.
We build and maintain relationships with tax law specialists across the world to make sure we are aware of laws and regulations as they change.
Bonus: Custom Tax Codes
Tools like TaxJar, Avalara, and other tax software provide you with tax codes for most products and services. However, most companies will eventually want to offer a product or service that doesn’t fit neatly into the description of any of the tax codes provided (e.g., an in-person conference with some virtual attendees and speakers). By using a tool like TaxJar, you’ll be on your own to calculate and collect the right amount and type of indirect tax since they won’t have a tax code for your unique situation.
This isn’t an issue for FastSpring sellers because we recently rolled out a feature that allows us to build unique product tax codes customized by use case — within minutes. Just tell us about your product or service and we will create the tax code for you.
Like FastSpring, Paddle takes the lead on gathering and remitting sales tax, VAT, and GST for you. Unlike FastSpring, Paddle doesn’t support tax exempt cases in the U.S.
Stripe Checkout is a prebuilt payment page designed for use on any device. You have a few options for customization (e.g., font, block shapes, colors, etc.) but it’s pretty limited. Stripe automatically translates Checkout to the appropriate language (35+ options) based on the buyer’s location.
FastSpring lets you customize your checkout, from custom fields to custom colors using our branding tools and CSS overrides. You also have the flexibility to choose whether you want to give your developer complete control over checkout or let FastSpring manage it for you (or somewhere in between).
Here’s an overview of FastSpring’s checkout options:
- Three versions: You have the option to embed checkout directly on your webpage, use a popup checkout, or redirect your customers to a Web Storefront managed by FastSpring.
- Localized Checkout: Let customers choose their preferred language or let FastSpring choose the appropriate language based on the buyer’s location. FastSpring supports 19+ languages.
- Built-in tracking and testing tools: With FastSpring’s built-in tracking tools, you can easily identify ways to improve conversion rates. Most companies that use this tool are able to increase their conversion rates by 30% or more.
- Personalized customer support: Although we give you complete control over your checkout, our team is always available to help you build the best checkout experience for your business. Some companies only provide personalized support to their largest clients and practically ignore small businesses. At FastSpring, we don’t play favorites. Our team is always happy to help in any way they can.
Paddle provides two versions of checkout:
- Embedded on your webpage
- Popup overlay
Within these two formats, they offer 50+ options for customization. Paddle supports 16 languages and automatically translates your checkout.
Stripe Billing includes a few different subscription options:
- Flat-rate billing (for a monthly or annual price)
- Multiple price billing (where a single product is sold for different prices in different locations)
- Per seat billing (based on active users during the billing cycle)
- Usage-based billing (single unit or tiered)
- Flat-rate + overage (a combination of flat-rate and usage-based billing)
These options work for some companies that only have a few simple subscription-based products, however, companies with more complex recurring billing needs (e.g., SaaS) often need an additional tool. To this end, Stripe has developed a close partnership with Chargebee so that it’s easier for their customers to get the subscription billing tools they need. Although it’s really easy to integrate these two tools, you will have to manage and pay for both separately.
Finally, Stripe offers a customer portal where customers can manage their accounts (both FastSpring and Paddle offer this as well).
Related: 8 Best Chargebee Alternatives and Competitors (And How They’re Different)
FastSpring provides a wide variety of subscription management options built specifically for SaaS companies.
Plus, most of these options can be set up without writing any code. For example, you can set up:
- Automatic weekly, monthly, or yearly recurring billing.
- Prorated billing to accommodate upgrades — and downgrades — mid-cycle.
- Free or paid trials of any length.
- Trials with or without collecting payment details (by not collecting payment details, you’re reducing friction at checkout, which typically leads to higher conversion rates).
- Automatic or manual renewal.
- Upsells, cross-sells, one-time add-ons, and discounts.
- And much more…
You will also have access to our API and webhooks library for more customization options.
One major point that often gets overlooked is whether or not your recurring billing model follows local transaction laws and regulations.
For example, the Reserve Bank of India (RBI) has very specific regulations regarding recurring payments. At the time of writing, the RBI limits automatic recurring payments to ₹15,000 (approximately $180). If a payment is over that amount, the customer must approve each transaction manually. You also have to file an official mandate with the RBI that outlines the procedures you have in place to ensure compliance. If you don’t file a mandate or have customers manually approve large transactions, you could face heavy fines or be prevented from selling to customers in India.
While some subscription management tools will release community updates whenever they learn about new regulations, you’re the one held responsible for keeping track of and adhering to all laws and regulations. If you don’t comply, you could face fines or be banned from doing business in that jurisdiction. Most companies need additional headcount to manage this.
FastSpring customers don’t have to worry about this because we take on transaction liability for you.
Our team of legal experts stays up to date on all relevant legalities, ensures the necessary procedures are in place, takes the lead on audits, and offers individual guidance on how to stay compliant — all at no additional cost.
Related: International Recurring Payments (How We Handle It for You)
Bonus: Digital Invoicing
FastSpring’s Digital Invoicing (DI) lets you manage B2B orders alongside B2C purchases. With DI, you can:
- Create and manage custom quotes in real time (including custom tags, coupons, discounts, and more).
- Set quote expiration dates.
- Request and accept payment.
- Add custom notes for your customer/prospect.
- Provide a self-service quote widget (this is especially useful when customers need approval before purchasing).
- And much more.
Using a series of webhooks and their API, Paddle supports the following subscription models:
Plus, some of these options can be combined. For example, you could have a tiered product where each tier allows for a different number of seats.
Paddle supports free or paid trials, however, customers will be required to provide payment details in order to start the trial. Paddle also automatically applies prorated amounts when customers change their plan mid-cycle (e.g., add new users or upgrade).
Related: An In-Depth Guide to Subscription Billing Platforms (+ 5 Options)
Reporting and Analytics
Stripe offers a suite of revenue recognition tools to help you streamline accounting, including:
- Standard accounting reports, such as balance sheets and income statements.
- Configurable revenue rules, such as excluding passthrough fees and auto-adjusting recognition schedules.
- Revenue overview reports.
- And more…
All reports can be viewed in your Stripe dashboard and some reports can be downloaded as a CSV file. You can also integrate with popular accounting tools such as QuickBooks Desktop and Xero. However, the ability to import data from other revenue recognition providers into Stripe is still in beta.
FastSpring Reporting and Analytics is a robust suite that helps you understand:
- How each product contributes to your bottom line.
- When customers are most likely to drop off.
- What coupons or promotions are working.
- Which subscription models generate the most revenue.
- Where your customers are located.
- What currencies and payment methods customers prefer.
- And much more…
Most of this information can be found in one of two dashboards: the revenue overview dashboard or the subscription overview dashboard.
The revenue overview dashboard contains more general information such as total transactions by country or net sales by product.
The subscription overview dashboard lets you drill down into more specific details like active customers or monthly recurring revenue (MRR) over time.
If you don’t see the exact report you need in these dashboards, you can create and save custom reports. Or, you can reach out to our team and we’ll help you find (or build) the report you need. Any report can be viewed in your dashboard or downloaded as a CSV, PNG, or XLSX file.
Paddle recently acquired ProfitWell in order to provide reporting and analytics features. However, the integration isn’t complete, so there will be some discrepancies between platforms. For example, they will show different MRR.
Once fully integrated, Paddle will be able to:
- Automatically track and report on key performance indicators, such as MRR.
- Monitor user engagement and churn.
- Provide benchmarking and segmentation tools.
- And more…
As a DIY platform, Stripe’s pricing works much differently than FastSpring or Paddle. With Stripe, you’ll need to pay for additional software and headcount to manage other aspects of the billing lifecycle such as advanced fraud detection, subscription management, remitting sales tax and VAT, and more.
Stripe also currently prices cards and wallets differently than other payment methods such as ACH and SEPA.
With all of these payment methods, you’ll have access to many of their services but not all of them. For example, Stripe charges additional fees for 3D-secure transactions, invoicing, tax features, and more.
To learn more about Stripe, visit their website.
With FastSpring, you’ll have access to the entire platform (and all services) for one flat-rate fee. Since we take on transaction liability for you and take the lead on sales tax and VAT, you won’t need any additional software or headcount.
Our team works with you to find an affordable price based on the volume of transactions you move through FastSpring. Plus, you’ll only be charged when transactions take place.
Reach out to our team to find the rate that works for you. You can also preview FastSpring features by setting up a free account.
Paddle advertises a flat-rate fee for their core product which includes most of the features you will need — payments processing, checkout, subscriptions, global tax and compliance, fraud protection and reporting, and more — but it doesn’t include everything.
For example, Paddle collects a 10% commission to recover abandoned carts.
To learn more about Paddle, visit their website.
Stripe currently has 4.4 stars on G2 (a popular software review site) with 82+ reviews.
FastSpring currently has 4.5 stars on G2 with 184+ reviews.
Here’s what some of our customers had to say:
Paddle currently has 4.5 stars on G2 with 145+ reviews.
Conclusion: FastSpring vs. Paddle vs. Stripe
If you’re selling physical products or services, FastSpring and Paddle are not an option, making Stripe the best choice out of the three options discussed here. If you are selling digital products, Stripe may not be the best choice because you’ll be on your own to build out a complete payment solution (which is costly and time-consuming).
FastSpring has been serving SaaS businesses for twice as long as Paddle and offers more features and capabilities. FastSpring is also better prepared to support B2B companies.
If you think FastSpring could be the right payment solution for your business, reach out to our team or set up a free account.